IN THE UNITED STATES DISTRICT COURT 

FOR THE EASTERN DISTRICT OF PENNSYLVANIA 

 

 : MASTER FILE NO. 2:05-MDL-1712-MAM 

IN RE: AMERICAN INVESTORS LIFE : 

INSURANCE CO. ANNUITY MARKETING : CLASS ACTION

AND SALES PRACTICES LITIGATION : 

 : ELECTRONICALLY FILED

 : 

THIS DOCUMENT APPLIES TO: ALL ACTIONS: 

 : 

MEMORANDUM OF PLAINTIFFS INFERRERA, DIGIOIA AND RYLES 

IN OPPOSITION TO THE MOTIONS OF OTHER PLAINTIFFS 

 FOR APPOINTMENT OF INTERIM LEAD COUNSEL 

Plaintiffs Edward A. and Gloria A. Inferrera, Americus DiGioia and Jean A. Ryles (the 

“moving plaintiffs”) respectfully submit this memorandum in further support of their motion for 

entry of a proposed pretrial order appointing interim co-lead class counsel and in opposition to 

the motions by plaintiffs in other actions for appointment of lead or co-lead counsel.1

 At issue on this motion is the appointment of interim co-lead counsel for plaintiffs and a 

nationwide class, as well as appropriate statewide subclasses, to effectively and efficiently 

prosecute the consolidated actions against AmerUs Life Insurance Company, American Investors 

Life Insurance Company, Inc., AmerUs Annuity Group and AmerUs Group Co., and various 

other defendants. As discussed in the moving plaintiffs’ opening brief, and as agreed by all 

movants, the appointment of interim co-lead class counsel is necessary and appropriate under 

Rule 23(g) of the Federal Rules of Civil Procedure.

 

1

 A chart identifying the actions before the Court pursuant to its Pre-Trial Order entered November 15, 2005, is 

attached as Exhibit A to the Declaration of William J. Ban (“Ban Decl.”) submitted in support hereof. 

Case 2:05-md-01712-MAM Document 22 Filed 01/27/06 Page 1 of 11
 

I. Moving Plaintiffs’ Proposal for Appointment of Interim 

 Co-Lead Class Counsel is in the Best Interests of the Class

As proposed by the moving plaintiffs, the appointment of the law firms of Barrack, 

Rodos & Bacine ("Barrack"), Berger & Montague (“Berger”) and Lerach Coughlin Stoia Geller 

Rudman & Robbins (“Lerach”) to serve as interim co-lead counsel presents the best alternative 

among the pending motions for appointment of co-lead counsel. Each of these three firms has 

the advantage of particular depth of experience. The Barrack group investigated and filed the 

first of all of the nationwide class cases and two of the nationwide class cases filed directly in 

this district, and has been involved in individual American Investors annuity sales practices cases 

as far back as 2001. The Lerach firm has profound depth of experience with virtually all of the 

significant insurance-related national class actions in the past twenty years. The Berger firm has 

been litigating individual and statewide (Pennsylvania) class cases in this Court. 

Two of the firms proposed, the Barrack and the Lerach firms, are integrally involved in 

litigation across the country seeking redress for seniors who are victims of schemes to market 

and sell improper and illegal deferred annuity products offered by other insurance companies. 

These actions, including, for example, cases against National Western and American Equities 

pending in the Central District of California, are being coordinated and conducted by counsel in 

the Barrack group and the Lerach group, who are all thoroughly experienced in this type of 

litigation, each member of which is eminently qualified and capable to seek appointment as lead 

counsel in its own right. These firms, including, in addition to the Barrack firm, William 

Shernoff of Shernoff Bidart & Darras; Andrew Friedman of Bonnett, Fairbourn, Friedman & 

Balint; and Howard Finkelstein of Finkelstein & Krinsk, 2 in addition to the Lerach group, 

 

2

 The qualifications and depth of experience of these counsel in insurance-related litigation was described briefly in 

moving plaintiffs’ opening brief and is amply demonstrated in the resumes of these three firms that are attached as 

Exhibits B, C and D to the Ban Decl. 

2

Case 2:05-md-01712-MAM Document 22 Filed 01/27/06 Page 2 of 11
 

nonetheless, all join in supporting the leadership structure proposed by moving plaintiffs 

Inferrera, DiGioia and Ryles.3

 

 As set forth in the moving plaintiffs’ opening brief, the Barrack group previously reached 

out to the other firms proposed as interim co-lead counsel in a spirit of cooperation and in an 

effort to quickly and efficiently establish an appropriate leadership structure. Indeed, the Lerach 

group has already demonstrated its desire to advance the best interests of the nationwide class 

and has filed its joinder in the motion of the Barrack group. Of the three co-lead counsel 

proposed by the Barrack group and the Lerach group, only the Berger firm has refused and 

instead proposes two of its own lawyers, Jerome Marcus and Jonathan Auerbach, to act, 

personally, as interim co-lead counsel, along with John Hargrove, counsel for a purely statewide 

(Florida) putative class in the Eddy case. 

 Rule 23(g) of the Federal Rules of Civil Procedure requires that appointment of class 

counsel adhere to specific criteria: 

(B) An attorney appointed to serve as class counsel must fairly and adequately 

represent the interests of the class. 

(C) In appointing class counsel, the court 

(i) must consider: 

• the work counsel has done in identifying or investigating potential 

claims in the action, 

• counsel’s experience in handling class actions, other complex 

litigation, and claims of the type asserted in the action, 

• counsel’s knowledge of the applicable law, and 

• the resources counsel will commit to representing the class . . . . 

 

3

 See discussion, infra, in Point III. 

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Fed. R. Civ. P. 23(g)(B),(C). Moving plaintiffs believe that the proposed leadership comprised 

of the Barrack, Berger and Lerach firms as interim co-lead counsel not only satisfies the 

requirements of Rule 23(g), but is the only proposed leadership that will: adequately and fairly 

serve the interests of all of the litigants, including both the nationwide and various statewide 

classes; be able to effectively leverage the work to date of all litigating groups for the benefit of 

the class; utilize the specific and specialized experience of the plaintiffs’ counsel already present 

in the litigation; and assure that adequate resources are committed to the class. The alternative 

proposals are far less than optimal in fairness to the parties because they fail to aggregate the 

most experienced counsel with the widest range of clients and interests to represent the 

nationwide class. See Manual for Complex Litigation, §20.221 at 27-28 (The most important 

factor in selecting a case management structure in complex litigation is achieving efficiency and 

economy without sacrificing fairness to the parties.) 

II. The Berger and the Hagens Firms Ignore the History 

 of the Development of this Litigation, Other Relevant 

 Facts and Rely on Incorrect Assertions ______

 

Firms in the Barrack group have pursued claims in litigation against defendant American 

Investors and its related entities since as early as October 15, 2001, with the filing of Worden v.

American Investors, Riverside Sup. Ct., Case No. RIC 365526. Numerous depositions were 

taken in that case, including depositions of American Investors Life Insurance Company 

executives. Extensive written discovery was exchanged and numerous documents were 

produced. After the defense motion for summary judgment was denied and a trial date was set, 

the case settled in August 2003. 

Counsel in the Barrack group also brought Westcott v. American Investors, L.A. Sup. Ct., 

Case No. BC 318323, filed July 12, 2004, which is currently set for trial June 19, 2006, after 

4

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numerous depositions, written discovery and the filing of plaintiffs’ Fourth Amended Complaint 

on August 22, 2005. In addition to prosecuting litigation against American Investors, firms in 

the Barrack group have been in the vanguard of pursuing litigation similar to this litigation 

against insurance companies that employ methodologies similar to those alleged here against 

American Investors in the fraudulent marketing and sale of inappropriate deferred annuities to 

seniors.4 

The proposals by the Berger firm and the Hagens, Berman firm (“Hagens”) ignore this 

history as well as other relevant facts and rely on factual assertions that are flatly incorrect. First, 

contrary to any inference made in briefing by the Berger and Hagens firms, the Inferrera action, 

E.D.Pa. No.2:05-cv-06117-MAM, commended by the Barrack group on April 11, 2005, in the 

Middle District of California, was the first nationwide class action filed against the American 

Investors defendants, based on the years-long involvement and coordinated investigation of 

counsel in the Barrack group of defendants’ unlawful nationwide sales and marketing practices. 

The Stein action commended by the Berger firm in this district on May 19, 2005, and the 

Studley action filed by the Hagens firm in the District of Kansas on April 25, 2005, each of 

which alleges a nationwide class, were clearly filed as “me too” actions by counsel seeking to 

elbow their way into a position in the nationwide case investigated and developed by counsel in 

the Barrack group. 

The Hagens firm, for example, has filed no other cases against defendants in this action. 

Although moving plaintiffs will not disparage the Hagens firm’s fine reputation generally in the 

class action field, the firm has no particular depth of experience or involvement with insurance 

 

4

 These cases include: Sweeney v. National Western, filed May 15, 2005, S.D. Cal., Case No. 05-cv-1018; 

McCormack v. American Equity Life Insurance Co., filed September 13, 2005, C.D. Cal., case No. 05-cv-6735; 

Negrete v. Allianz Life Insurance Company of North America, filed September 13, 2005, C.D. Cal., Case No. 05-cv6838; and, Negrete v. Fidelity and Guarantee Life, filed September 13, 2005, C.D. Cal. Case No. 05-cv-6837. 

5

Case 2:05-md-01712-MAM Document 22 Filed 01/27/06 Page 5 of 11
 

litigation relevant to prosecuting this action and, accordingly, is an inappropriate choice to act as 

co-lead counsel.5

 Moreover, in its brief, the Hagens firm ignores the fact that the Inferrera case 

was the first nationwide class action filed against defendants herein and labels the Barrack group 

as merely representing a transferred case from the Central District of California. The Hagens

brief also ignores the Barrack group’s nationwide class cases -- DiGioia and Ryles -- commenced 

in this district on behalf of two Pennsylvania residents, as well as the Barrack group’s 

coordination with Lerach group, which filed a nationwide class action originally in the Middle 

District of Florida, now transferred to this district, and which firm also is included in the 

proposed leadership structure representing a client victimized by defendants’ scheme in a state 

where defendants have been particularly active. 

The Berger firm proposes a structure that is unworkable. Seeking to leverage its pending 

but limited Pennsylvania statewide class and individual actions6 to hijack the nationwide class, 

the Berger firm proposes two of its own individual attorneys to act personally as part of what it 

apparently hopes the Court will perceive as a three-way leadership structure.7

 The Bergerproposed slate pretends to be diversified in that it includes counsel from the Eddy action, filed in 

 

5

 In the interest of efficiency and a spirit of cooperation, the Barrack group reached out to Timothy Scott, the 

Hagen’s firm’s counsel in this action, to assure Mr. Scott that he and his firm will be able to participate 

meaningfully in the consolidated litigation on behalf of their clients and the class regardless of the outcome of this 

motion. To date, the Hagens firm maintains its motion. 

6

 The Price and Miller actions were filed in this district by the Berger firm and other counsel on July 15, and 

August 11, 2004, respectively, alleging a Pennsylvania statewide class. Those actions were filed, coordinated and 

prosecuted along with several local non-class actions before this court, including Walker v. Bohmueller, et al, 03 cv 

3750 (now settled); Miller v. Bohmueller, et al, 03 cv 6496 (now settled); Gilmore v. Bohmueller, et al, 04 cv 2535; 

Trimble v. Weinstein, et al, 05 cv 2109; and other more recently filed individual non-class actions. 

7

 The Berger firm’s self-serving suggestion for appointment of two of its own attorneys as co-lead counsel and 

appointment of a specific liaison counsel is problematic, inter alia, because: (1) appointment of individual 

attorneys, rather than their firm, as a whole, does not ensure that adequate resources will be available to the class 

should these individual counsel leave their current firm; and (2) the motion for appointment of a separate 

Philadelphia-based firm as proposed “liaison” counsel inexplicably suggests that proposed co-lead counsel, itself 

located in center-city Philadelphia, would somehow require a “local” liaison counsel, similarly located, to interface 

with the Court. 

6

Case 2:05-md-01712-MAM Document 22 Filed 01/27/06 Page 6 of 11
 

the Middle District of Florida, which alleges only a Florida statewide class.

8

 The interests of 

the Berger group are clear: it represents and has consistently sought to coordinate litigation for 

limited individual and specific limited statewide classes in Pennsylvania and Florida and filed its 

nationwide class action (Stein) only after the Barrack group filed the first such class case. The 

Berger firm and its co-counsel, with only one nationwide class case, do not represent the 

demonstrated breadth of the Barrack group in pursuing claims on behalf of nationwide class. 

The apparent interest of the Berger firm and its co-counsel, or their clients, appears to be in 

pursuing remedies available to strictly statewide classes or to individuals, as is readily apparent 

from even a cursory perusal of Exhibit A to the Ban Decl.9

The Berger firm’s statement in its brief (Mem. at pp. 2 and 7) that “[a]llegations relating 

to those persons residing in California . . . have been resolved . . .” and that the Inferrera

plaintiffs “no longer have standing” is just plain wrong. First, the Berger firm’s brief totally 

ignores the DiGioia and Ryles cases commenced in this district by the same counsel who are 

counsel in Inferrera. More importantly, Inferrera seeks certification of a nationwide class and is 

not subject to a statewide settlement in California. Edward and Gloria Inferrera, in fact, chose to 

opt out of the settlement of the California state court action, Cheves v. American Investors Life 

Insurance Company, Inc. See Exhibit E to the Ban Decl. submitted in support hereof. 

 

8

 The Hargrove firm’s involvement in Strube v. American Equity Investment Life Insurance Co., in the Middle 

District of Florida, touted in the Berger firm’s brief as support for that firm’s appointment as co-lead counsel, 

provides a less than compelling example of success in this type of litigation. Class was denied on motion. The class 

was ultimately certified but only as part of a “claims-made” settlement class that provided class members who opted 

in an option to eliminate the deferral period, a 2% bump up on annuity value and $1,700,000 in counsel fees paid to 

counsel representing the class. The settlement was valued at, potentially, somewhat more than $14.7 million 

compared with plaintiffs’ expert’s estimate of $733.9 million in recoverable damages, a 2% recovery. See, 226 

F.R.D. 688, 695 (M.D.Fla. 2005). 

9

 Moreover, the statewide class definition in the Berger firm’s Miller case does not even purport to cover all 

Pennsylvania residents but only those who purchased deferred annuity products from American Investors, American 

Equity or National Western and defendants “Weinstein and the sales Group.” Miller, First Amended Complaint, p. 

33. Similarly, the Berger firm’s Price case, in alleging a statewide Pennsylvania class, excludes Pennsylvania 

residents who did not purchase American Investor deferred annuity products through defendant “Bohmueller and the 

sales Group.” Price, Complaint, p. 33. 

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To be sure, the Berger firm is experienced counsel whose involvement as co-lead counsel 

is welcomed. The Barrack group looks forward to an opportunity to work together with the 

Berger firm and the Lerach group for the benefit of the nationwide class and the several 

statewide subclasses that may be necessary to render full and complete relief utilizing all 

available remedies. 

III. Actions Against American Equities and National Western 

 Are Properly Separate From This Litigation 

As set forth in the moving plaintiffs’ opening brief, attorneys William Shernoff of 

Shernoff Bidart & Darras, Andrew Friedman of Bonnet, Fairbourn, Friedman & Balint and 

Howard D. Finkelstein of Finkelstein & Krinsk are co-counsel with the Barrack firm in the 

Inferrera, DiGioia and Ryles actions. As a group, these firms, together with the Lerach group, 

are prosecuting other senior annuity class actions in other jurisdictions against several distinct 

defendant groups, two of which include American Equities and National Western.10 Although 

Miller v. AmerUs Group Co., et al, Case No. 04-cv-3799, before the Court, names both 

American Equities and National Western as defendants, those defendants are not alleged in 

Miller to be related in any way to the American Investors/AmerUs defendants. They are indeed 

joined in the action simply because plaintiff Miller is alleged to have purchased deferred 

annuities from each of these defendants in separate, unrelated transactions. 

On January 5, 2006, a Conditional Transfer Order was issued by the JPMDL for 

McCormack, Case No. 2:05-6735 (C.D. Cal.), and Sweeney, Case No. 3:05-1018 (S.D. Cal.), to 

transfer these nationwide class cases against National Western and American Equities to this 

Court to be consolidated or coordinated with Miller, which asserts claims against American 

Investors, National Western and America Equities solely on behalf of statewide (Pennsylvania) 

 

10 See footnote 4.

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Case 2:05-md-01712-MAM Document 22 Filed 01/27/06 Page 8 of 11
 

classes. The moving plaintiffs do not believe the National Western and American Equities cases 

should be consolidated with this American Investors/AmerUs case and have objected to the 

Conditional Transfer Order. If the McCormack and Sweeney cases are transferred to this Court, 

however, the moving plaintiffs believe that, because the facts of those cases are necessarily 

different from the facts of this case (and, indeed, different from each other), separate interim lead 

counsel should be appointed for those cases and different firms within the Barrack group would 

seek appointment as interim lead counsel for those cases. 

The Berger firm’s effort to secure appointment as a functional sole lead counsel in this 

action should be considered in light of the JPMDL’s Conditional Transfer Order for McCormack

and Sweeney, should those cases ultimately come before this Court. The Berger firm has no 

separate, independent case involving National Western or American Equities and no case 

seeking certification of a nationwide class with respect to those defendants. 

The several firms comprising the Barrack group and the Lerach firm, each of which is 

sufficiently experienced and capable to merit appointment under Rule 23(g) as lead counsel for 

the nationwide class in this litigation, have already sought to establish a workable, fair and 

efficient management structure for prosecuting this nationwide class action against the American 

Investors/AmerUs defendants. This effort involved very capable and experienced counsel 

stepping back from seeking their own selection as lead or co-lead counsel in the interest of 

efficiency and organizational cohesiveness. To allow the Berger firm to functionally assume a 

position of sole leadership in this litigation going forward would ignore the consistently 

demonstrated primary interest of that firm and its various co-counsel in pursuing limited 

individual and statewide class actions and ignore the consistent coordinated effort to obtain 

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certification of a nationwide class by the firms in the Barrack group, the Lerach firm and their 

respective clients. 

IV. CONCLUSION

 For the reasons set forth herein and in their opening brief, the moving plaintiffs 

respectfully request that the Court appoint the Barrack, Berger and Lerach firms as interim colead counsel for the class to provide for the orderly and efficient conduct of these and any related 

actions. 

Dated: January 27, 2006 BARRACK, RODOS & BACINE 

 By: /s/ Daniel E. Bacine 

 Leonard Barrack 

 Daniel E. Bacine 

 William J. Ban 

 3300 Two Commerce Square 

 2001 Market Street 

 Philadelphia, PA 19103 

 Telephone: (215) 963-0600 

 Facsimile: (215) 963-0838 

Stephen R. Basser 

John L. Haeussler 

BARRACK, RODOS & BACINE 

402 West Broadway, Suite 850 

San Diego, CA 92101 

Telephone: (619) 230-0800 

Facsimile: (619) 230-1874 

Proposed Interim Co-Lead Class Counsel 

Howard D. Finkelstein 

Mark L. Knutson 

FINKELSTEIN & KRINSK 

501 West Broadway, Suite 1250 

San Diego, CA 92101 

Telephone: (619) 238-1333 

Facsimile: (619) 238-5425 

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Case 2:05-md-01712-MAM Document 22 Filed 01/27/06 Page 10 of 11
 

Andrew S. Friedman 

Elaine A. Ryan 

Patricia N. Syverson 

BONNETT, FAIRBOURN, FRIEDMAN 

 & BALINT P.C.

2901 North Central Avenue, Suite 1000 

Phoenix, AZ 85012-3311 

Telephone: (602) 274-1100 

Facsimile: (602) 274-1199 

William M. Shernoff 

Evangeline F. Garris 

SHERNOFF BIDART DARRAS 

600 South Indian Hill Boulevard 

Claremont, CA 91711 

Telephone: (909) 621-4935 

Facsimile: (909) 625-6915 

Bernice J. Koplin 

SCHACHTEL, GERSTLEY, LEVINE 

 & KOPLIN

123 South Broad Street, Suite 2170 

Philadelphia, PA 19109-1029 

Telephone: (215) 772-1700 

Facsimile: (215) 772-0312 

Debra G. Speyer 

LAW OFFICES OF DEBRA G. SPEYER 

Two Bala Plaza, Suite 300 

Bala Cynwyd, PA 19004 

Telephone: (610) 949-9555 

Facsimile: (610) 949-9554 

Attorneys for Plaintiffs Edward A. and 

Gloria A. Inferrera, Americus DiGioia, Jean 

A. Ryles and the National Class

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